Korzinka, Uzbekistan's retail chain, has inked a significant loan agreement with the International Finance Corporation (IFC) for up to $25mn. The funds will be utilized for the construction of a state-of-the-art distribution center (DC), aligning with Korzinka's ongoing expansion plans and commitment to sustainable practices.
The new distribution center is anticipated to play a pivotal role in fostering job creation, supporting local farmers and suppliers, and enhancing access to high-quality and affordable food, especially in regions beyond the capital.
As part of the agreement, the IFC will collaborate with Korzinka to implement green building initiatives and gender equality practices within the company. This marks a significant step towards promoting environmental sustainability and creating an inclusive work environment.
Currently operating five distribution centers covering a total area of approximately 30,000 sq.m., Korzinka's upcoming facility will be the largest yet, spanning an impressive 18,000 sq.m. Construction is scheduled to commence in 2024, with the first phase expected to be completed by 2025.
Driving Growth in Uzbekistan's Retail Landscape
Korzinka's need for a new distribution center stems from its dynamic growth and expansion in recent months. In the first three quarters of 2023 alone, the retail giant accomplished several milestones:
- Opened the inaugural wholesale store, Korzinka Biznes.
- Launched the online supermarket, Korzinka Go.
- Introduced a new format of Korzinka Mahalla stores.
- Opened over 20 new stores.
The collaboration with the IFC is set to fuel further growth, enabling Korzinka to diversify its offerings and stimulate key sectors of agriculture and food production in Uzbekistan.
Addressing Development Challenges in Uzbekistan's Food Retail Sector
Uzbekistan's modern food retail market is still in its nascent stages, constituting only 8% of the total food retail volume, in contrast to 75% in Eastern Europe. This discrepancy poses challenges to the growth and efficiency of the nation's agriculture and food processing industries, which are integral to its economic foundation.
The strategic alliance with the IFC is expected to mitigate these challenges, propelling Uzbekistan towards a more robust and efficient food retail sector.
Pioneering Sustainability and Gender Equality
In addition to the financial support, Korzinka is collaborating with the IFC to become one of the first companies in Central Asia to achieve two prestigious international certificates:
- EDGE (Excellence in Design for Greater Efficiencies): Focused on reducing the carbon footprint of building construction and operations, lowering costs, and advancing sustainable development.
- Gender EDGE (Economic Dividends for Gender Equality): Geared towards creating an optimal work environment for both women and men within the company, with a focus on maximizing business benefits.
Commenting on the collaboration, Zafar Khashimov, founder and chairman of the supervisory board of Korzinka, stated;
"For almost 30 years, creating convenient conditions for customers has been one of our priorities. IFC funding will allow us to improve this process and expand our services across the country in a challenging external environment."
IFC Country Director for Turkey and Central Asia, Wiebke Schloemer, emphasized the positive impact of a robust food retail sector on economic development.
"IFC's investments will help further grow the sector, increase the variety and availability of food for local consumers, as well as improve food security and create thousands of sustainable jobs in the country," said Schloemer.
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